New RBI governor Sanjay Malhotra pledges policy stability, stresses on agility

New Reserve Bank of India (RBI) governor Sanjay Malhotra pledged policy stability, while stressing on “agility” to deal with global challenges, on day one of taking charge at the central bank.

Malhotra took charge as the 26th governor of RBI on Wednesday, succeeding Shaktikanta Das who demitted office on Tuesday after a six-year stint at the top.

Malhotra, a former revenue secretary, will serve a three-year term as the head of India’s central bank.

In his speech, Malhotra also stressed on the themes of stability, trust and growth “as India enters the Amrit Kaal,” a key period aimed at transforming into a developed nation by 2047, envisioned as “Viksit Bharat.”

“Change is the only constant. We have to be conscious of it. While we do maintain policy continuity and stability, we cannot be stuck to it, and we have to be alert and agile to meet the challenges,” he added during his first interaction with the media after taking charge at RBI.

Malhotra also listed spreading financial inclusion as one of his top priorities.

The nation has come a long way on financial inclusion, “but there is still more to be done. We will collaborate with all the key stakeholders, especially financial regulators, the central government and the state governments so that the benefits of formal financial inclusion reaches everyone,” he said.

The Indian Administrative Service (IAS) officer from Rajasthan cadre assumes charge at the central bank amid slowing economic growth and persistent inflation.

The RBI has of late come under increasing pressure from the political class to cut interest rates as growth slowed to a seven-quarter low of 5.4% in the July-September quarter.

The central bank had kept interest rates unchanged for nearly two years, citing inflation risks.

Sitharaman and trade minister Piyush Goyal had both recently called for lower borrowing costs to support the economy.

Analysts see the central bank taking a softer approach to monetary policy under Malhotra.

As revenue secretary in the finance ministry, Malhotra played a key role in shaping tax policies for both direct and indirect taxes.

Previously, he was secretary in the department of financial services, where he contributed to various reforms in the financial sector.